Kenya Airways AGM expected to be platform for fight over Board positions

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KENYA GOVERNMENT SUGGESTS IT WANTS TO ENLARGE ITS PRESENCE ON THE KQ BOARD

(Posted 08th September 2016)

The upcoming Annual General Meeting of Kenya Airways, due on the 29th of September, this year is likely to see the Kenyan government, which holds just under 30 percent of the shares in the company, seek greater representation on the Board of Directors.
Second largest shareholder is the airline’s strategic partner KLM, which holds just under 27 percent, which under the initial investment agreement has the right to a certain number of seats on the board, a key vote on senior management positions and notably a veto right on certain decisions the board can take.
Also laying down claims for a seat on the board is apparently the International Finance Corporation, which has bought into the company, setting the scene for some heavy bargaining no doubt ahead of the formal votes being cast during the AGM when it comes to electing Directors.
One of the present Directors from the KLM camp has according to reports from Nairobi already signalled he will not offer himself for re-election, no doubt an opening gambit for things to come ahead of and during the AGM.
There has been talk among pundits that a fresh capital injection of up to 100 billion Kenya Shillings may be needed from existing shareholders who have seen the value of their shares during the current calendar year fall to some of the lowest points ever.
It is anticipated that the two major shareholders, who command an absolute majority of shares among them, would invest more money in the carrier, as broad economic indicators suggest that the airline has turned the tide and is flying into calmer financial skies again.
Be sure to watch this space for up to date reports about the proceedings of the AGM and the new board lineup when the elections have been concluded.

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